"If Amazon isn’t on the agenda at board meetings for Australian retailers, then it should be."
Deloitte retail executive David White has issued a warning around the impending arrival of Amazon.
White said the potential for major market disruption is significant, with the rumoured launch set to take place this year.
“We are already seeing several retailers setting up task forces to assess the potential impact of an Amazon market entry, but it’s not yet clear what exactly the company has planned for Australia," he said.
"But we do know that where Amazon has entered new markets, impacts on local retailers have been seismic and across almost all categories and channels.
"So retailers can’t afford to wait and see what Amazon does – they need to be developing strategies and taking action now.”
White's warning coincides with the release of Deloitte's annual Global Powers of Retailing report, which ranks retailers on revenue and trends.
Amazon continued its rapid ascent, joining the top 10 leader board of the Top 250 for the first time in FY2015.
The world’s largest e-retailer ranked 186th in 2000 when it first entered the Top 250.
Fueled by a constant stream of product and service innovations, it has posted robust, double-digit growth since its inception in 1994.
Amazon is one of many rumoured global entrants into the market, with recent arrivals including Decathlon, John Lewis and Debenhams.
The latter two brokered their launch via partnerships with Myer and Harris Scarfe respectively.
White said more global brands will land on local shores in 2017.
This is due to the strength of Australia's economic conditions compared to other countries, high consumer demand from international brands and the nation's close proximity to Asia.
“One of the key differentiators international retailers have brought to Australia is in their store design and customer experience model, leveraging their experience from larger markets," he said.
“With just 16% of the Top 250 retailers globally operating in Australia, and US-based retailers making up nearly 50% of that total, we can expect more new global retailers to bring their operations to our shores in 2017.”
Finally, the report also revealed key trends pertaining to customer behaviour and engagement.
The five key trends according to the report are:
- Less is more: Customers placing more importance on curated experience and product rather than quantity.
- Following economy: A social media trend that see customers more concerned with experiences and products relevant to their personal brand.
- Retailisation of the world: this relates to the maker movement and the increase in non-traditional retailers developing new business models such as flash-sales.
- On-demand shopping and fulfillment: relevancy will be determined by the ability of retailers to meet the on-demand mindset of the modern consumer.
- Exponential living: the impact of technology on the way in which customers shop.